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March 31, 2014

British Jobs and the Single Market

  • This new analysis by the Centre for Economics and Business Research (Cebr) on behalf of British Influence, updates the 2000 report  ‘UK jobs dependent on the EU’ by Brian Ardy, Iain Begg and Dermot Hodson of South Bank University’s European Institute.

 

  • Ardy, Begg and Hodson found that in 1997, 3,445,000 jobs in the United Kingdom were associated with demand from exports to the European Union, which included 2,500,000 jobs directly supported and 900,000 indirectly created from demand from those jobs.

 

  • This updated Cebr analysis now shows that in 2011 (latest available figures) 4.2 million jobs, or 13.3% of the UK workforce, were associated with exports to the EU.

 

  • Within this 4.2 million, an estimated 3.1 million UK jobs were directly supported by exports to the European Union in 2011 and 1.1 million jobs were indirectly supported – i.e. through spending income earned from exports.

 

  • Total income associated with demand from EU exports was £211 billion or £3,500 per head of the population in 2011.

 

  • Based on the latest available data, the analysis examines change over time, finding that the number of jobs associated with demand from the EU has increased from 3.7 million to 4.2 million over the period 1997–2011. The number of jobs associated with EU demand in professional, technical, scientific services and in business and administration support services have risen particularly rapidly between 1997 and 2011 over the period, with the numbers of jobs in both of those industrial sectors almost doubling. Manufacturing has fared less well in this respect, losing jobs, but this is against the backdrop of structural decline in UK manufacturing employment over the period and the 2011 figures were compiled during the post-crisis sustained weakness in economic growth; the part that exports to the EU has fared better than manufacturing as a whole over the period.

 

  • The region that gained the most jobs was London, which now has 27% more EU-supported jobs than it did in 1997.

 

  • On average, the UK gained 12% more jobs than it had in 1997, and the only region to have fewer EU-associated jobs now than it did then was the West Midlands. Nevertheless, the West Midlands still has 385,000 jobs linked to EU demand.

 

Important notes

 

  • This piece of research does not imply that the estimated jobs would be lost if the UK were to leave the EU; it is an analysis of demand arising from UK exports to the EU.

 

  • This piece of research does not take a position on United Kingdom EU withdrawal but rather seeks to inform the debate with robust, quantitative evidence based on publicly available data.

 

  • All of the data sources referenced here can be found online; full references and links are available in the references section.

 

  • This research does not quantify the effect of imports and an analysis of net trade; this is an analysis purely of the demand associated with exports to the EU.

 

Cebr Economist Alasdair Cavalla, main report author, said: “This should inform the debate on Britain’s membership of the European Union with quantitative evidence.

 

“We updated the 2000 piece of research by Ardy, Begg and Hodson to ensure that the debate is backed up with up-to-date figures on this crucial aspect of our relationship with Europe.”

 

Prof Douglas McWilliams, Executive Chairman of Cebr,said: “This report demonstrates the levels of UK economic activity that are associated with demand from the European Union.

 

“Cebr estimates this at 4.2 million jobs, or £211 billion in national income terms. Jobs are spread across UK regions, but East Midlands and West Midlands have the highest proportion of their workforces supported by demand from the EU.

 

“Across the economy, the manufacturing sector has most jobs linked to demand from exports to the EU but it is notable that between 1997 and 2011, the numbers of EU-supported jobs in business services have almost doubled.

 

“As the debate of the UK’s relationship with the EU continues, I think it is important that debate understands a sizeable chunk of the UK economy is supported by demand from EU member states.”

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